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CBI: core inflation will not exceed 7% in 2011
Monday, June 20 / يونيو 2011 11:59 | |
Reuters) - An official of the Iraqi Central Bank is expected core inflation should not exceed seven percent in Iraq in 2011, with the economy remains relatively stable under a stable flow of goods and the lack of government expenditure is not expected.
Ahmed said Abreha deputy central bank governor said on Sunday that the bank does not intend to raise interest rates - which were reduced to six percent in April 2010 - to fight inflation.
He told Reuters in an interview, "I do not expect to exceed the inflation rate of seven percent.
"The current interest rate is acceptable ... the central bank will not resume the policy of raising interest rates."
The rate of core inflation for Iraq - which does not include the cost of fuel - has accelerated to 6.3 percent in May from 6.1 percent in April, driven by the cost of imported goods and services, especially health care.
Flood of foreign goods and the domestic market because of low domestic production after years of war and economic sanctions.
The program helps the Iraqi food ration cards in the absorption of some of the increases in prices and central bank says it expects the annual inflation remains in single digits.
As many as 60 percent of the Iraqi government food program.And the country of the largest importers of wheat and rice in the world.
Abreha said he expected the decline in unemployment this year.The unemployment rate, according to official figures in Iraq, 15 percent, while working 28 percent of the workforce in part-time jobs and said, "It depends on the construction activities ... as soon as we can activate and develop the activities of the building and construction, we can absorb the growing numbers of unemployed."
The race is moving slowly towards the rebuilding of its infrastructure crumbling after more than eight years on the US-led invasion the United States and he needs to invest in almost all sectors.
And the private sector is still relatively small compared to the state-owned enterprises and the government still employs the largest number of workers.Iraq relies on oil exports for 95 percent of government revenues.
Abreha said that the government plan to restructure the banks, the main state-owned Iraq and rational move forward slowly and he did not expect to complete the program in the near future.
Iraq had decided in 2006 to restructure its banking sector to allow direct investment in banks and bring down the debt accumulated by state-owned banks after decades of war and economic isolation.
Abreha said that the expected growth of foreign investment this year compared with 2010, but foreign investment in non-oil sectors of the Iraqi economy is still low.
Of Aseel Kami and Serena Chaudhry
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